All posts tagged loan

As efforts to turn around the struggling retailer J.C. Penney faltered this year, some said a plan B for the company could be to raise cash by selling off some of its property portfolio, comprised of well-placed retail stores across the country. Others suggested the company could be split in two: a retailer running a smaller number of department stores, and a property company leasing out the rest of the real estate to other tenants.

The loan, which one of the people said would be secured by assets including a “significant” portion of the company’s real estate, would give the junk-rated department-store chain a big injection of funds as it works to bring back customers and complete store renovations after a disastrous year under former Chief Executive Ron Johnson.

The loan would bear an interest rate around 6.5% and would come due after five years, one of the people said. Penney has yet to sign the loan, the person said.

The loan would give the company plenty of breathing room as its new CEO Myron Ullman (who was also the old CEO) carries out the delicate task of moving forward with former CEO Ron Johnson’s efforts to modernize the stores, while jettisoning other parts of his strategy that led to an exodus of customers.

The Anaheim, Calif., designer of a $100,000 sports car, furloughed 200 U.S. workers in March for a week to conserve cash, while continuing a long-running effort to seek buyers or investors that would help it resume vehicle production that was halted last July. Some of the staff that were furloughed and brought back in March are now being dismissed.

While others including China’s Dongfeng were once considering buying out the company, the last time the WSJ looked into the talks, it seemed they had fallen apart.

Fisker makes for a tricky acquisition. It doesn’t make its own batteries, instead buying them from the bankrupt battery maker A123, which was recently taken over by China’s Wanxiang (parts of the company were renamed B456 in history’s least creative rebranding exercise). Production of the Fisker Karma sports car was suspended when A123 closed down.

Its cars haven’t been selling particularly fast, and while Tesla used the momentum from its high-performance roadster to roll out a luxury sedan (and soon, a high-end SUV), Fisker is still stuck on its first, niche, model. While it released prototypes for the new Fisker Atlantic sedan last April, it said later in the year that production might not begin until 2015. After today’s firings, even that looks optimistic.

So what would you buy Fisker for? There’s the designs and the knowledge, although most big car companies have already moved well along in their own electric vehicle programs. For smaller players trying to get into the market, the fact the company has a model that has already run through the full regulatory/testing gauntlet and made it onto American roads is a big deal.

Fisker also has access to a large ($337 million) amount of loan money still available from the U.S. Department of Energy. The downside to that money: it would require the company to produce its vehicles at an aging former GM factory in Delaware. That requirement, the WSJ reported in March, was one reason talks with the potential Chinese buyer fell apart.

Also worth noting as Fisker goes through tough times: this hasn’t been the best week for the company’s board member and investor Ray Lane. On Thursday, he stepped down as chairman of HP, following widespread dissatisfaction among shareholders in the wake of $8.8 billion in writedowns on the company’s botched Autonomy deal. Just a day later, and Fisker is laying off staff and looking in serious trouble.

Fisker, Lane said back in 2011, could eventually be worth as much as game developer Zynga. With Zynga today valued at just under $2.8 billion, that now looks more optimistic than ever.

Satcon Technology Corporation, a leading provider of utility scale power conversion solutions for the renewable energy market, today announced that the Company and its subsidiaries have filed voluntary petitions under Chapter 11 of the United States Bankruptcy Code. The petitions were filed in the U.S. Bankruptcy Court for the District of Delaware.

Steve Rhoades, Satcon’s President and Chief Executive Officer, said “This has been a difficult time for Satcon. After careful consideration of available alternatives, the Company’s Board of Directors determined that the Chapter 11 filings were a necessary and prudent step, allowing the Company to continue to operate while giving us the opportunity to reorganize with a stronger balance sheet and capital structure. Our goal is for Satcon to emerge from bankruptcy reorganization and continue to provide our customers with the quality products that they need.”

Back in August, advanced battery maker A123 Systems Inc. announced Chinese auto parts maker Wanxiang Group would extend the company a $450 million lifeline, taking an 80% ownership stake in the business. Today, A123 filed for bankruptcy protection, announcing a U.S. rival, Johnson Controls, will acquire its electric vehicle battery business and fund the company through its restructuring process.

“We determined not to move forward with the previously announced Wanxiang agreement as a result of unanticipated and significant challenges to its completion,” said David Vieau, A123′s chief execuitve, in today’s statement (PDF).

Whatever could that mean? The company did not elaborate. But in yesterday’s SEC filing announcing it would default on some of its debt, the company gave some more details, which we’ll go into after the jump. Read More »